Title:
– When is Government a Business and –
– when is Government a Government –| Author: EYE-BALL Guru | 14th May 2013 |

Talk for some time now from the Opposition Treasury spokesperson Mr Joe Hockey, has been about the developed world facing the end of the era of ‘universal entitlement’.

Where does a Government get the ‘creds’ to measure its own responsibilities in business like terms when forecast revenues, budgets, and underlying debt become challenging?

Mr Hockey is heir to the Treasurer throne and will be the Treasurer in a few months. Understanding his belief system is very important to what he will bring to the table as a Treasurer.

In a speech delivered a little over 12 months ago to the INSTITUTE OF ECONOMIC AFFAIRS in London – link to full speech – Mr Hockey spoke at length about the ‘era of entitlement’.

The speech is a road map to Hockey’s mindset about Government and its overriding responsibilities.

At face value the comments may seem naive and Liberal policy sabre rattling. If Mr Hockey believes everything he said in his address, then that is a little frightening when we look at the developed world, the GFC after taste, the ongoing and unsolved global debt burden, and the extent of the people suffering under austerity measures.

Hockey’s vision can be seen as a Government trying to implement business type models and act like a business wanting to disengage from the true and overriding responsibilities of Government. If that is overstated, then at the very least he wants to hit the reset button and allow a review on the real purpose of where Government sees itself into the future.

An example of Hockey’s belief system …:

“THE END OF THE AGE OF ENTITLEMENT”

ADDRESS TO THE INSTITUTE OF ECONOMIC AFFAIRS – LONDON

17 APRIL 2012

By: JOE HOCKEY MP

Introduction: …

“… So, ultimately the fiscal impact of popular programs must be brought to account no matter what the political values of the government are or how popular a spending program may be.

Let me put it to you this way: The Age of Entitlement is over.

We should not take this as cause for despair. It is our market based economies which have forced this change on unwilling participants. What we have seen is that the market is mandating policy changes that common sense and years of lectures from small government advocates have failed to achieve. And we have subsequently witnessed over the last twelve months a raging battle.

This has been a battle between the fiscal reality of paying for what you spend, set against the expectation of majority public opinion that each generation will receive the same or increased support from the state than their forebears.

The entitlements bestowed on tens of millions of people by successive governments, fuelled by short-term electoral cycles and the politics of outbidding your opponents is, in essence, undermining our ability to ensure democracy, fair representation and economic sustainability for future generations.” …

Surely Mr Hockey understands that it is the politician who makes the promises to get re-elected, and then spends the money on policies to remain elected. Does he suggest his Government will be different?

Identifying the problem does not solve the problem!!!

In contrast, my last few posts have taken Mr Swan out for a spin and proved his dunce-hat status when it comes to his ability to understand currency value, and its impact on the trade wars that exists and ignite around labour costs, the efficiencies of Industrial Law, and with a workforce and welfare receipent base all resistant to any form of wage/pension reductions.

Mr Swan’s answer has been to fund the revenue shortfall with new debt, and rather then rein in new spending, his Government has set the wheels in motion with more and new large ticket policies that will mortgage the Nation even further into the future.

Mr Hockey in his address above sees the madness in Swan’s logic and intent. But then Mr Hockey swings the pendulum toward a commercial context and that puts his position as a politician serving the people, at odds with the responsibilities of any true democratic Government.

It is only with a review of history that the mistakes made back then can be revealed in the present.

Howard’s middle class welfare spend is where the problems started and currently exist. Having given that welfare help to people who did not really need it, how does a Government try to take it back from those who already have it. And in the face of a GFC aftermath that has seen reduced work hours and the only real jobs growth in part-time employment.

For voters the choice is easy – give Gillard the reins and see the Nation become another Greece, or Spain within 3-5 years, of give the keys to Abbott, hoping and trusting his team know what they are doing.

Hockey’s Budget reply response on Thursday will be a real test for the ‘big’ now ‘much smaller’ man. He is yet to shine on his own in matters of finance and Treasury.

His financial blueprint for an Abbott Government could set up an early election via a ‘no-confidence’ motion in coming weeks.

If he fails – it’ll be back to the drawing board and Mr Swan will get to swoon for a few more months – all to Australia’s detriment.

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